Origen

The word chip was probably formed from an Old English word, forchippian, ‘to cut off’. A person who is thought to resemble one of their parents in character or behaviour can be described as a chip off the old block. The phrase was originally found in the forms chip of the same block and chip of the old block, so that the person appeared made from the same material. To have a chip on your shoulder is to be aggressively sensitive about something, usually some long-standing grievance or cause of resentment. The expression is first recorded in American English. An explanation can be found in an early example from the Long Island Telegraph of 20 May 1830: ‘When two churlish boys were determined to fight, a chip [of wood] would be placed on the shoulder of one, and the other demanded to knock it off at his peril.’Another meaning of chip is ‘a counter used in gambling games, representing money’, and such gambling chips, especially as used in the game of poker, feature in a number of common phrases. If someone has had their chips, they are beaten or out of contention. The idea is of having run out of gambling counters or chips with which to place a stake. Similarly, when the chips are down you find yourself in a very serious and difficult situation. To cash in your chips is to die—you are no longer ‘in the game’.

Deep-fried slices of potato have been known as chips since the time of Dickens. You might think of the phrase cheap as chips as being a recent invention, but it, too, goes back to at least the 1850s, when it was used in an advert in The Times.